How to use this time wisely
Hi
I am looking to get starting with real estate investing later in the fall. I am trying to figure out the best way to use my time working from home. I listen to podcasts, read a lot of books, and network (before quarantine). What are things I can do besides these -- more in the realm of business planning?
Thanks
Take action on the things you learn from those things! Define your goals, map out your plan, etc. Your next action after that will be informed by what your goal is. Now would also be a fantastic time to start building your brand. Define your branding and style, build a website, etc. You can also continue to network online.
We're all on a very equal playing field now.
Hello Austin,
I'm new to investing myself. I would say you could also register for the upcoming webinars, and practice analyzing properties with the analysis report. Like I said, I'm new to investing as well, however I can say that It has been helping me out a lot. Good luck.
@Taylor L. What are some things I can do to get out of a financing logjam? Let me explain.
My plan is to do a duplex house hack for my first house. But given market rents, I would most likely only be able to make money on a duplex $215K or less (in Dallas/Fort-Worth). I think the average duplex starts around 350K, so this is a hard deal to find (assuming I want to live in a safe area).
I only have enough cash for a 3.5% down payment. Is it feasible to get more for a down payment from a partner/private lender. I feel it'd be hard to convince someone to lend me money, when I have no experience. Are there other ways to get access to a larger down payment so I can decrease the mortgage obligation?
As far as a website/branding, I'll definitely check into it. Does it make sense to do so at this time, if I haven't even bought one property?
Thanks!
Austin
- Real Estate Broker / Investor
- Austin, TX
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Work on identifying very specific goals for REI. This is the number one reason RE Investors fail.
What do you want in $
When do you want it
How much risk can you tolerate
What assets do you have to start with or what assets can you acquire
etc...
PS: Don't quit your day job anytime soon! REI is not an overnight process.
Originally posted by @Austin Bright:@Taylor L. What are some things I can do to get out of a financing logjam? Let me explain.
My plan is to do a duplex house hack for my first house. But given market rents, I would most likely only be able to make money on a duplex $215K or less (in Dallas/Fort-Worth). I think the average duplex starts around 350K, so this is a hard deal to find (assuming I want to live in a safe area).
I only have enough cash for a 3.5% down payment. Is it feasible to get more for a down payment from a partner/private lender. I feel it'd be hard to convince someone to lend me money, when I have no experience. Are there other ways to get access to a larger down payment so I can decrease the mortgage obligation?
As far as a website/branding, I'll definitely check into it. Does it make sense to do so at this time, if I haven't even bought one property?
Thanks!
Austin
Regarding the house hack - it's a tough question. I live in a similar area, where duplexes located in areas you'd actually want to live are priced waaayyy above where they'd cash flow if you weren't living in one of the units. My decision was to pursue another strategy (larger multifamily & self storage).
One thing you might consider is buying a single family and Airbnbing a room or two. Perhaps convert the bottom level of a split-level into an inlaw suite, which you can separate from your living area.
This stuff takes creativity!! Normally I recommend people get out and network, but that's obviously not an option right now. Keep reading books and listening to podcasts.
Regarding a website - it's a great way for new investors to establish credibility. Your particular business model might never require a website, but it's a great way for people to learn about you and your goals. But, it might not matter for your goals. It's just something to consider!
@Taylor L.
You started with larger multi family? Like apartments? That’s cool, how?
I’d like to get into larger multi family eventually. I just think no one in their right mind would partner with someone with 0 experience? Is that incorrect to think?
Hey @Austin Bright I'm in the same situation, looking to get started investing in real estate as soon as we can get back out there and look at properties. In the meantime I have been working on my LLC which I just started on April 4th. I used incfile.com and they basically did everything for free (it only cost $150 to file in my state). Then used Fiverr.com to hire a freelancer to create a logo which you can see here in my signature. Then to create my website I used website.com, you may not need one but I wanted to establish some credibility to potential lenders/investors. You can look at mine if you want to get some ideas (link in signature). All this cost me less than $300! Other than that I've been working on a business plan, I bought a lead list using listsource.com, driving for dollars using the Deal Machine app, applied for a HELOC, opened a small business bank account and now I'm looking to rollover my retirement accounts into self directed ones to buy RE with. Educating and networking are a given and we should all be doing this every day as real estate investors. Good luck with everything let me know if you use any of those platforms I suggested and if you have any questions!
@James Campbell Thanks! Super helpful! for the IRA/HELOC, I imagine you spent years building this up? Or did you do BRRRR and take out the HELOC. I'm trying to understand if ultimately I need to spend like 5ish years building financing like this first, or if it is feasible to get started without much initial financing (I have about 30K in cash and could qualify for an FHA loan at this point)?
@Austin Bright No problem! So the HELOC would be taken out of my primary residence. I built up equity when I move it and fixed it up 2 years ago. I settled for a condo as a first property because I was in the same situation as you and I couldn't afford a duplex. I set up my 401k (through work) and an IRA on the side about 3 years ago and I've been contributing as much as I can since then. Now I'm trying to figure out ways to access that retirement money to invest in real estate. To answer your question I would say at this point be patient and save as much as you can until we see what a post-coronavirus economy looks like. You definitely don't want to over leverage yourself and buy your first property while property prices are falling. You may be able to get into a duplex cheaper if you wait a bit and the housing market takes a hit. Some other things you could do is look for an off market duplex that needs some work and try to buy it for a discount. Also you could look for a partner and split the duplex and its costs in half.
@Austin Bright make sure your finances are in order to get a loan!
Hey Austin, I'm in a similar position as you. Looking to get started towards the fall as the country starts to open up again. I'll be using this time to sharpen my skills finding and analyzing deals. Still working on networking virtually like here on bigger pockets. I am investing out of state so I'm also working on building out my team (agent, lender, property manager) and partners so we can hit the ground running. Lots to do while at home still! Best of luck!